WSJ Underscores Hallmark Homecare Advantage

WSJ Underscores Hallmark Homecare Advantage

A recent story in The Wall Street Journal sheds further light on one of the many advantages of the Hallmark Homecare model of care: higher caregiver compensation. Caregivers placed by Hallmark Homecare earn on average 30% higher wages than their peers working at traditional agencies, which means increased caregiver satisfaction and lower turnover. The significantly improved pay rates available through our model also allows Hallmark Homecare to attract and place caregivers of the highest quality and professionalism. The full WSJ article appears below:

Help Wanted (a Lot): Home-Health Aides

Fast-Growing Industry Experiences High Turnover Amid Low Pay and Demanding Duties


PHILADELPHIA—Dolores Streater works in one of the fastest-growing professions in the country. It is also among the lowest-paying and most-demanding. And, not coincidentally, it has particularly high turnover.

Ms. Streater is a home health-care aide.

Over the course of a day, she spends two hours commuting among her elderly and disabled clients, navigating public transportation and juggling an irregular schedule of primarily morning and evening appointments. She starts around 8 a.m., arriving at her first client’s home by 9 to help with bathing, dressing and breakfast. She makes sure her clients take their medicines, checks their weight and offers a measure of companionship.

She currently earns just over $10 an hour—she’s received several raises after three years at her company—and works six days a week. While she does receive health benefits and a transit pass, she concedes the work is still difficult.

“It’s a job and we all need a job in this economy,” the 63-year-old Ms. Streater said during a recent visit to a client here, adding that the work has rewards beyond a paycheck, including satisfaction from helping people in her community. “I’d rather make something than nothing.”

No major segment of the workforce is expected to expand faster in coming years than that of the paid caregivers who assist aging Americans at home. The jobs typically don’t require a high-school diploma, there is little required training and the average workweek is 34 hours.

The U.S. Labor Department predicts the profession will grow by nearly 50%, or the equivalent of nearly a million new jobs, by 2022. That is nearly five times the average for all occupations and above the coming demand for retail, restaurant or construction workers specifically.

But the main problem isn’t attracting new home-health aides, people in the industry
say. It is keeping caregivers in a profession that can be emotionally and physically difficult, and often offers only part-time work with limited pay and few benefits.

Turnover for home-aide workers is around 40% to 65% each year, according to experts and researchers, while the median annual wage hovers around $20,000, more than $5,000 below the other healthcare support occupations the Labor Department tracks. The workforce also includes personal-care aides, who help with daily, nonmedical tasks, and certified nursing assistants.

One of the country’s biggest home-care employment agencies, ResCare, hires about 2,000 new workers nationwide each month—but most of that is to replace workers who have left, said Chief Executive Ralph Gronefeld Jr.

“The challenge is finding people,” Mr. Gronefeld said. “The people that do this work are very special.”

Various states, trade groups and companies are now trying to find ways to broaden the appeal of the work and reduce turnover. The biggest obstacle for home health-care aides is pay.

The bulk of funding for the home health-services industry—roughly 73%, or $44.3 billion—comes from government programs, primarily Medicaid and Medicare, according
to the Paraprofessional Healthcare Institute, a home-care advocacy organization.

Some 15% of the industry is paid through private insurance and the rest by consumers out-of-pocket or other sources. But industry observers say those private revenue
sources have dwindled in recent years as families turn away from more expensive care options that would also drain their savings.

Karen Kulp, Ms. Streater’s employer and president of HomeCare Associates, says the industry is constrained by the state and federal Medicaid reimbursement system, which allows little wiggle room for pay. States determine rates for care, whether it is per visit or by the hour. But the payments must also cover an agency’s administrative staff, overhead costs and benefits.

“For us especially, our pay rates are based so much on what we get reimbursed,” Ms. Kulp said. “If we’re going to want to raise those rates, we have to think about reimbursement on the federal level.”

But Dorie Seavey, senior policy adviser at the paraprofessional group, says rates are largely set on an as-needed basis to meet demand for care and determined in response to a state’s particular budget outlook at the time or other factors. Further, there is little federal government oversight or guidance to update or change the rates on a regular schedule.

Those ad hoc rate-setting methods rarely allow for an evaluation if wages are adequate or reasonable, she said. “It really is the key impediment to improving compensation.”

Ms. Kulp addresses these challenges by running as lean an organization as she can while still offering her employees $9 to $10 an hour, overtime, benefits, and pay raises the longer they stay. “Our philosophy is that in order to provide quality care, you have to provide a quality job,” she said.

A number of other changes are afoot within the industry to make it more appealing and stable.

Starting next year, home health-care workers employed by agencies or other third parties will be covered under the Fair Labor Standards Act, which guarantees the national minimum wage, currently at $7.25 an hour, and overtime protections.

Home-aide workers in some states have joined unions, affording them guaranteed minimum wage pay and other benefits.

Some agencies also see training beyond the basic requirements as another way to improve the quality of care and reduce turnover. At Cooperative Care in Wautoma, Wis., workers first go through a few weeks of hands-on training and don’t meet with clients on their own until they feel comfortable.

Tracy Dudzinski, the agency’s administrative coordinator and board chairwoman, has a larger vision. “People always look at this as the bottom rung of the ladder,” Ms. Dudzinski said, of home-care aides. “We should consider it a career lattice, where you can branch out into a specialty.”

Caregivers can complete additional training and focus on, for example, patients with dementia or those who are developmentally disabled. That extra training can translate into extra pay down the road.

“The more specialties you have, the more you make,” she said. “That’s the way it should be.”